24th Jul 2014 12:33
LONDON (Alliance News) - Edge Resources Inc Thursday said it has agreed to a new loan facility of up to USD17 million with ATB Corporate Financial Services, more than doubling its current credit facilities.
The Canada-focused oil and gas company said the deal replaces its previous USD8 million facility with the National Bank of Canada, which the company entered into in February 2012.
The company said the new facility will carry an interest rate of the Canadian prime rate plus 1.75% per year, significantly lower than the National Bank facility, which had a rate of Canadian prime rate plus 3% per year.
Edge Resources said it has currently drawn down USD6.3 million on the facility, leaving it with headroom to develop its oil and gas assets.
"This is a tremendous show of confidence from one of the biggest lenders to Canadian Junior Oil and Gas companies," Chief Executive Brad Nichol said in a statement.
"The new facility also drastically reduces our cost of capital and provides us with a much larger pool of funds with which to fund new projects such as the acceleration of our drilling programme in Eye Hill, infrastructure projects that aim to lower our operating costs and/or short-fuse, opportunistic acquisitions," Nichol added.
Edge Resources shares were up 7.9% to 10.25 pence on Thursday.
By Tom McIvor; [email protected]; @TomMcIvor1
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